The Sources of Macroeconomic Fluctuations in Subsaharan African Economies: An application to Côte d'Ivoire

Ahmat Jidoud ()

No 12-346, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: This paper quantifies the empirical importance of various types of relevant shocks in explaining macroeconomic uctuations in a typical Sub{saharan African economy (C^ote d'Ivoire) in the context of a Dynamic Stochastic General Equilibrium (DSGE) model and Bayesian techniques. Our analysis first documents that transitory but persistent productivity shocks are the dominant sources of macroeconomic volatility as they explain more than half of aggregate uctuations. Second, world interest rate shocks are found to be non{negligible especially in driving uctuations in consumption growth. Third, while fiscal policy is found to be procyclical, fiscal shocks play a minor role in this economy. In addition, negative productivity shocks coupled with positive world interest rate shocks are at the origins of the poor macroeconomic performances of the economy in the 80s. These findings are in line with the business cycle literature on African economies and also robust to various perturbations of the benchmark set-up.

Keywords: Aggregate fluctuations; Subsaharan economies; DSGE model; Bayesian method; transitory and permanent shocks (search for similar items in EconPapers)
JEL-codes: C11 C51 E32 (search for similar items in EconPapers)
Date: 2012-10
New Economics Papers: this item is included in nep-afr, nep-dge and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:26459

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